Author: Tim Bovee

Live: Friday, Sept. 22, 2017

Tim Bovee

9/22 – 3:20 p.m. New York

I made one trade today, exiting JBL.

Next week will be a slow week as well, with three potential trades: CCL, MU and NKE.

9/22 – 10:10 a.m. New York time

I have rolled out of JBL because of the change in earnings publication date, as discussed in an update to the analysis, and shall consider re-entering on Wednesday, Sept. 27. If I do re-enter, then I shall treat today’s exit as a roll. If I decline to re-enter, then I shall treat today’s exit as the end of the trade and at that time shall calculate results.

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JBL Analysis

Tim Bovee3 Comments

Jabil Inc. (JBL)

Update 9/22/2017: I rolled out of JBL this morning, for a $1.75 debit with shares priced at $29.75,  because of the change in earnings publication date. I shall consider re-entering on Wednesday, Sept. 27. If I do re-enter, then I shall treat today’s exit as a roll. If I decline to re-enter, then I shall treat today’s exit as the end of the trade and at that time shall calculate results.

Update 9/21/2017: JBL moved its earnings announcement to Wednesday, Sept. 27, two days before the options in my position expire. I shall roll the position forward to a later expiration, probably the options expire Oct. 6.

JBL publishes earnings on Wednesday (Sept. 27 — see update above)) after the closing bell.

I shall use options that trade for the last time nine days hence, on Sept. 29. (See update above.)

Implied volatility stands at 35%, which is 3.5 times the VIX, a measure of the volatility of the S&P 500 index.

JBL’s IV stands in the 73rd percentile of its annual range and at the peak of its most recent broad movement.

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The Week Ahead: Money policy, housing

Tim Bovee

The Federal Open Market Committee culminates a two-day meeting on Wednesday with an announcement and forecasts at 2 p.m. New York time, and a news conference with Fed Chair Janet Yellen at 2:30 p.m.

The FOMC raised the Fed Funds Rate to 1.25% on June 14. Widely held expectations are for one more rate increase this year, and Wednesday’s meeting would be a prime candidate for the decision.

Two major housing reports will be issued: Housing starts, on Tuesday at 8:30 a.m. and existing home sales on Wednesday at 10 a.m.

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ORCL Analysis

Tim Bovee1 Comment

Oracle Corp. (ORCL)

Update 9/25/2017: ORCL gapped $2.14 to the downside after earnings were published, declining for four consecutive days before recovering a small amount of the loss. The expiration calendar dictated my exit on Monday for a loss.

Earnings came in about as expected, with a consensus forecast of 63 cents per share and reported earnings of 62 cents. Zacks analysis had forecast only a  -0.34% chance of a downside earnings surprise. The stock’s beta, at 1.05, ios equivalent to the S&P 500.

The first-day declined of $4.05 after earnings exited the expected move of $2.37 and the average post-earnings move over the past year of $4.33. In some, the price response was a true outlier.

Shares declined by 6.3% over 11 days, or a -209% annual rate. The options position produced a -37.9% loss for a -1,257% annual rate.

ORCL publishes earnings on Thursday after the closing bell.

I shall use options that trade for the last time 15 days hence, on Sept. 29.

Implied volatility stands at 29%, which is 2.8 times the VIX, a measure of the volatility of the S&P 500 index.

ORCL’s IV stands at the peak of both its annual range and its most recent broad movement.

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